"It was taking us from six to 14 weeks to start small projects," says Art Crocker, FM Process Owner for the General Motors (GM) Worldwide Facilities Group, "which meant we were neglecting the more important, multimillion-dollar projects."

In a span of 12 months, WFG has managed to reduce project start times down to an average of two weeks by using a new project delivery model called the Project Delivery Program Manager (PDPM) program, which has been in development since 1998.

Three Common Programs

A key element to expedited project delivery has been the one-stop shopping service model with its use of FM reps: single points of contact for servicing FM customers.

"To help the FM reps service our customers quicker," says Crocker, "we added three common programs— help desk, a Web-based service, and the PDPM program— also provides customers with an alternative to accessing services."

The help desk screens customer requests and routes the request to an FM rep who puts the customer in contact with WFG Regional Engineering who will oversee the construction process. When the Web-based service was launched in during July 2000, the help desk was receiving 40,000 calls per month.

The Web-based service, called myfacility.com, is based on the original one-stop shopping model, providing a single Web site in GM for accessing services provided by WFG. When the Web site was launched 60 people staffed the call center. By the end of August 2001 customer calls increased to 80,000 a month, while the staff was reduced to 30.

"It is a very user friendly portal," says Crocker.

The PDPM program is WFG's process for expediting delivery of small (less than $1 million) construction projects. PDPM is built around the single-service provider concept that is directly related to the one-stop shopping model.

"The backbone of the PDPM program is that we single source all our work," notes Crocker. "We don't go out for competitive bids, taking a lot of time out of the process."

Early Supplier Involvement

The PDPM program is based upon having one service provider per GM-defined region. Customer requests go directly to the PDPM Regional Program Operator, a GM engineer, who prepares an independent estimate. This estimate serves to benchmark expected project costs. The customer also provides a financial commitment for the project. The engineer then goes to the designated construction supplier to document a not-to-exceed quote for the project. Finally, the contractor's quote is compared against the engineer's own estimate. If there is a less than ten percent gap, the project moves forward. If there is a more than ten percent gap, it is the engineer's responsibility to either negotiate the price or to understand why a gap exists.

"It could be that our estimate was bad or there was a misunderstanding of the project scope," says Crocker. "Estimating is a tough business. This stop-gap applies a discipline of making sure the engineer understands the quote and puts the contractor under some scrutiny to make sure he is giving a good price."

Upon agreement between the engineer and the PDPM supplier, a purchase order is cut and construction starts. The PDPM program took three years to gain management approval and gives authority to the WFG to issue purchase orders for the single-source providers as well as having the responsibility for financial controls.

"Knowing up front who the contractor is going to be reduces the bid process on small projects from potentially 12 weeks down to one week," notes Crocker.

For this single-source system to work, cooperation is needed between WFG and the PDPM contractor. Therefore the selection of the contractor is important. The GM Worldwide Purchasing Group pre-qualifies suppliers who are going to participate in the bidding process for a region. The safety records and financial stability of each supplier are checked prior to the bid process. After the bid process, one supplier is awarded a blanket order contract for all construction work either in a region or at a site. Contracts are awarded on a three-year basis, providing stable work and giving the supplier a strong incentive to be cooperative in pricing and quality assurance.

Successfully involving contractors early in the small construction process at GM shows potential for doing the same with architectural and engineering vendors.

"I call it 'design for constructability,'" says Crocker. "With the luxury of knowing who the contractor is going to be, we can also bring the A/E in at the front end to create the most cost-efficient design."

Transparent Management by FM Scorecard

Management of each PDPM supplier is via a three-point quality assurance program: monthly performance metrics on all PDPM suppliers; checking quotes against independent estimates to validate costs; and twice-yearly audits.

The monthly performance metrics for each supplier are posted to the WFG Web site. The result is a paperless reporting system easily accessible by those who need the information. Metrics monitor response time, performance schedule, safety, and the dollar volume of projects moving through the program.

"We call the Web site an FM scorecard for our metrics," says Crocker. "An engineer anywhere in the country can log onto the site and look at the performance values of any of our suppliers at any location. It increases the visibility of the PDPM program to management because the metrics are always available to anyone who wants to see how the program is doing.

Panorama Business Views, a provider of performance measurement and management solutions based in Toronto, Canada, maintains the site for WFG.

The WFG targeted five days as an acceptable quote response time. On average response times have been as low as three days. The release time, the time between receiving a quote and management signing off on the purchase order, is eight or nine days.

"Release time has been running up because of budget constraints," notes Crocker. "It takes longer for people to sign purchase orders and it won't improve until the budget constraints ease."

With the PDPM program, eighty-seven percent of the projects have remained on schedule or unaltered, and safety has recorded no lost workdays since January 2001.

Twice each year, internal WFG staff audit 10 percent of the PDPM construction projects to insure that they are following the basic elements of the specifications set out by WFG.

Regional and Program Deployment

Currently, WFG has four regional contracts in place with a fifth contract in Ohio expected to be in place by June 2002. The development of large regions for GM's PDPM program is challenging because the larger the region the fewer the suppliers able to successfully leverage all that might be required of them.

"We develop our regions by a logistical grouping of plants," says Crocker. "For example, Ohio may develop into three regions as we look at what the plant groupings might be and at the suppliers that are available to efficiently serve those groupings.

"The main emphasis for WFG will be to bring more of our common programs into our manufacturing facilities," he continues. "As the PDPM program continues to demonstrate benchmarked efficiencies we expect more and more high level buy-ins from the plant managers. You can't argue with success."

By Lawrence A. Howard

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